Required Minimum Distribution Mistakes to Avoid
Traditional retirement accounts are tax-deferred, not tax-free. As baby boomers turn 70, they must soon begin mandated withdrawals and pay the taxes on the money they tucked into retirement accounts over several decades.
A required minimum distribution is the amount retirement account owners must withdraw from their IRAs and 401(k)s each year. When you take these withdrawals, you also have to pay taxes on each distribution. Retirement account withdrawals are required after age 70 1/2, except for Roth IRAs, which do not have distribution requirements for the original account owner.
Rodney Brooks
An award-winning journalist, writer and author and my specialty is retirement planning and other personal finance issues. I have written for many national publications, including USA TODAY, The Washington Post, U.S. News & World Report, AARP and National Geographic. I am available to speak on personal finance, financial literacy and the racial wealth gap.
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The author tells the history of the Freedman’s Savings Bank, how it grew much too quickly, why it failed and the impact on Black America. The Freedman’s Bank offered a safe depository for formerly enslaved people, expanded quickly and gained millions in deposits – mostly ranging from $5 to $50. But inexperience and corruption doomed it to failure, costing may of the small depositors their savings.
